Securities and investment business is regulated in Bermuda by the Investment Business Act 2003. Bermuda Monetary Authority regulates “investment business” in or from with the Bermuda and provides that no person may carry on “investment business” of any kind in or from within the Bermuda unless they are licensed
The types of activity constituting investment business are broadly defined as follows:
The following are the categories:
Category 1: Dealing in Investments
Category 2: Arranging Deals in Investments
Making or offering, or agreeing to make—
Category 3: Investment Management
Managing or offering, or agreeing to manage, assets belonging to another person where those assets consist of or include investments.
Category 4: Investment Advice
Giving or offering, or agreeing to give, to persons in their capacity as clients or potential clients, advice on the merits of their purchasing, selling, subscribing for or underwriting an investment, or exercising any right conferred by an investment to acquire, dispose of, underwrite or convert an investment.
The entity making the application is a company registered or incorporated in Bermuda or elsewhere and includes a partnership which is a body corporate.
Company includes:
a) a company limited by shares;
b) a company limited by guarantee that is not authorised to issue shares;
c) a company limited by guarantee that is authorised to issue shares;
• The license will need at least 2 (two) natural person Fit and Proper Directors of any jurisdiction.
• A license shall not appoint a director or senior officer without the prior written approval of the Authority.
• The director must pass the fit and proper criteria
• The license will need at least one shareholder.
• Corporate shareholding is allowed and 100% foreign ownership is permitted.
Unless the license has a significant management presence in the Bermuda, it will be required to appoint a local “authorized representative”, which will be an individual certified by the Bermuda Monetary Authority for this purpose.
A license shall not, without the prior written approval of the Authority:
a) open, maintain or carry on business through a branch or a representative or contact office outside the Bermuda; or
b) incorporate, form or acquire a subsidiary.
The relevant licensee shall appoint and at all times have an auditor for the purposes of auditing its financial statements. The auditor must be:
• qualified under the Regulatory Code to act as the auditor of a licensee
• consent to act as auditor
A licensee shall at all times maintain such professional indemnity and other insurance as may be prescribed.
Where the Regulatory Code prescribes a minimum capital resource requirement with respect to a category or sub-category of license, a licensee holding a license in such category or sub-category shall ensure that at all times its capital resources are maintained in an amount not less than the prescribed minimum.